Permanent TSB Plc (Formerly Irish Life & Permanent Plc) v Noel Morrissey
| Jurisdiction | Ireland |
| Judge | Mr. Justice Garrett Simons |
| Judgment Date | 22 January 2021 |
| Neutral Citation | [2021] IEHC 18 |
| Date | 22 January 2021 |
| Docket Number | 2020 No. 19 CA |
| Court | High Court |
[2021] IEHC 18
2020 No. 19 CA
THE HIGH COURT
CIRCUIT APPEALS
Personal insolvency arrangement – Debtors – Unfair prejudice – Debtors appealing from the judgment of the Circuit (Personal Insolvency) Court on the Midlands Circuit refusing the debtors’ application pursuant to s. 115A of the Personal Insolvency Acts 2012-2015 – Whether the personal insolvency arrangement was unfairly prejudicial to the creditor
Facts: The debtors, Mr and Ms Quirke, appealed to the High Court from the judgment of the Circuit (Personal Insolvency) Court on the Midlands Circuit of 10th December, 2020, in which that court refused the debtors’ application pursuant to s. 115A of the Personal Insolvency Acts 2012-2015 (the Act). The applications of the debtors were interlocking applications, and there was a single creditor of each of the debtors, namely the Governor and Company of Bank of Ireland (the bank). The matter came before Sanfey J on 1st March, 2021. Counsel for the debtors and the bank agreed an issue paper, setting out the substantive and discretionary issues which they considered to be arising from the case. They canvassed whether the arrangements were unfairly prejudicial to the creditor in a number of respects; whether the rejected arrangements return the debtors to solvency and whether they are sustainable; and whether the live balance on the debtors’ home loan with the creditor “was arrived at in accordance with law and whether the Rejected Arrangements provide for payments to the Creditor in accordance with the Debtors’ future means”. There were two discretionary issues in which the debtors’ repayment history in the two years prior to the issuance of the protective certificate was in issue; the creditor also referred to the fact that it had obtained an order for possession of the principal residence “which order the debtors unsuccessfully attempted to have set aside”.
Held by Sanfey J that, in all the circumstances, he did not consider that the Personal Insolvency Arrangement (PIA) was unfairly prejudicial to the interests of the bank. While the payment history of the debtors was not impressive, Sanfey J believed that they understood the importance of adhering to the repayment terms and the consequences if they did not. Sanfey J noted that both debtors were in full time employment, and would hopefully face their obligations in the future with renewed determination to make the arrangement work. Sanfey J considered that the costs set out in the PIA were appropriate, including the costs of the Personal Insolvency Practitioner (PIP). Sanfey J did not consider that the PIP acted inappropriately in deciding to make two applications rather than a joint application. Sanfey J was satisfied that the live balance of the loan was arrived at appropriately by the PIP. Sanfey J was satisfied that the payments in the PIA were affordable and sustainable. In so holding, Sanfey J took into account the assurance of the PIP. While the arrangement would require considerable discipline and vigilance on the part of the debtors, particularly while their children were at college, it seemed to Sanfey J that the arrangement was viable and that the debtors could, with prudent and careful budgeting, keep to the terms of the PIA and the restructured payments.
Sanfey J held that there would be an order confirming the coming into effect of the PIA. Sanfey J held that the matter would be listed for the first personal insolvency list after delivery of this judgment so that submissions may be made as to the terms of the court’s order.
Appeal allowed.
JUDGMENT of Mr. Justice Garrett Simons delivered on 22 January 2021
The within proceedings come before the High Court by way of an appeal against an order for possession granted by the Circuit Court. This judgment is delivered in respect of a preliminary application, made in advance of the hearing of the appeal, to add another financial institution as a second plaintiff to the proceedings. The application is made pursuant to Order 17, rule 4 of the Rules of the Superior Courts.
The defendants have indicated that they have no objection to the application. The purpose of preparing this short judgment is to address the standard of proof, and to explain the limited effect of the proposed joinder.
The plaintiff, Permanent TSB plc (“ PTSB”), instituted these proceedings before the Circuit Court seeking to recover possession of lands owned by the defendants. The proceedings are predicated on two indentures of mortgage and charge (“ the mortgages”) said to have been entered into between PTSB, as mortgagee, and the defendants, as mortgagors.
The Circuit Court made an order for possession on 14 January 2020. The defendants have brought an appeal against that order. The appeal has not yet been listed for hearing.
Start Mortgages DAC (“ Start Mortgages”) now applies to be added to the proceedings as an additional plaintiff. The basis of the application is that the ownership of the mortgages entered into by the defendants has been transferred from PTSB to Start Mortgages as part of a much larger transaction involving the sale of a “loan book” previously held by PTSB.
The solicitor acting on behalf of the defendants has indicated in correspondence (dated 11 October 2020) that her clients do not object to the proposed joinder, and would not be attending at the hearing of the motion.
The application to make Start Mortgages a party to the proceedings has been made pursuant to Order 17, rule 4 of the Rules of the Superior Courts. The Order reads as follows.
4. Where by reason of death, or any other event * occurring after the commencement of a cause or matter and causing a change or transmission of interest or liability, * or by reason of any person interested coming into existence after the commencement of the cause or matter, it becomes necessary or desirable that any person not already a party should be made a party, or that any person already a party should be made a party in another capacity, an order that the proceedings shall be carried on between the continuing parties, and such new party or parties, may be obtained ex parte on application to the Court upon an allegation of such change, or transmission of interest or liability, or of such person interested having come into existence.
The interpretation of Order 17, rule 4 has been considered in a number of recent judgments. The Court of Appeal addressed two aspects of the wording of the Order as follows in Stapleford Finance Ltd. v. Lavelle [2016] IECA 104. First, it was held that the phrase “any other event”, in the opening sentence of the Order, included events such as the assignment of loans and a chose in action. An “event” is not confined to an extraneous event (such as death or bankruptcy), but also embraces an event such as a contract for the sale of loans and mortgages.
Secondly, it was held that the phrase “change … of interest” was not confined to an interest in land, but embraced an assignment of a chose in action. It was further held that there was no distinction in this regard between the assignment of a chose in action and the assignment of an existing cause of action. The Court of Appeal held (at paragraph 20 of the...
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